No one knows yet what products will be hit as part of a Trump administration plan to impose tariffs on Chinese imports, but chemicals are unlikely to emerge unscathed from any U.S.-China trade conflict.
President Donald J. Trump announced on March 22 that the U.S. will impose tariffs on about $60 billion worth of Chinese goods to punish the country for technology and trade-secret theft. The White House says it will reveal the list of goods within 15 days of Trump’s announcement.
Unlike manufacturing overall, chemical trade was roughly in balance last year.
|COMMODITY||U.S. EXPORTS, $ MILLIONS||U.S. IMPORTS, $ MILLIONS|
|Dyes and pigments||499||545|
|Total trade, all commodities||149,661||431,783|
Sources: Customs General Administration of the People’s Republic of China, C&EN calculations
The plan followed a separate U.S. proposal to impose tariffs on aluminum and steel produced in China and other countries.
In response to the March 22 announcement, China threatened a countermeasure that would target about $3 billion worth of American goods, including fresh fruit, nuts, and wine. Officials hinted that a fuller response could follow.
In a statement, the Chinese embassy in the U.S. vowed that “if a trade war were initiated by the U.S., China would fight to the end to defend its own legitimate interests with all necessary measures.”
Even before the U.S. announcement, chemicals were vulnerable to trade conflicts. In a preliminary ruling last month, China’s ministry of commerce found the U.S., Taiwan, and South Korea guilty of dumping low-priced styrene in China. The ministry demanded that manufacturers from those countries immediately pay a deposit in anticipation of new tariff duties if the final ruling confirms the dumping.
Chemicals represented about 10% of total U.S. merchandise exports to China in 2017. The proportion rises to more than 14% if plastics are included. The $21.5 billion worth of chemicals and plastics that the U.S. shipped to China last year was more than the $19.5 billion in agricultural products that it shipped. From China’s perspective, chemicals were about 3% of all the goods shipped to the U.S.